Almost half of all Grand Traverse County renters are paying over a third of their income on housing, while a quarter are considered severely cost-burdened – meaning more than half of their income is going toward housing. The county has an overall housing gap of 11,361 units, including a need for at least 3,569 more rental units and 7,792 for-sale residences.

Those are among the findings of a new 2023 Housing Needs Assessment (HNA) released Wednesday by Housing North in partnership with Bowen National Research, which evaluated the 10-county region to provide both a regional snapshot and individual reports on each county. Affordability, availability, and quality of housing all continue to pose “major hurdles” in northern Michigan, Bowen National Research Founder and President Patrick Bowen said in a Zoom presentation.

All 10 counties – including Antrim, Benzie, Charlevoix, Emmet, Grand Traverse, Kalkaska, Leelanau, Manistee, Missaukee, and Wexford – have for-sale housing availability rates of 1.1 percent or lower, with many at rates below 0.5 percent (Grand Traverse County is 0.4 percent). That represents an “incredible shortage of for-sale housing across the region in every county,” Bowen said, adding that healthy markets typically have rates of 2-3 percent. Nearly two-thirds of homes listed for sale are priced over $300,000, which is “unaffordable to 75 percent of the region’s renters,” Bowen said. In Grand Traverse County, the median list price is $465,450. That trend – product weighted toward the $300,000 and even $400,000 range – is being seen not just in northern Michigan but across the country, Bowen said. The result is that “housing is getting further and further out of reach for a lot of folks,” he said.

The local rental picture isn’t much rosier. Across the region, there’s a 99.3 percent occupancy rate in multi-family housing. That is “well above” the typical healthy market range of 94-96 percent, Bowen said. “You want vacancies for a healthy community,” he said. “You don’t have them...pretty much universally across the counties you have a wait list.” That is true even for market-rate rentals – several counties have zero percent vacancies in market-rate units (pictured, chart) – but especially government-subsidized housing. A total of 8,661 households are on a wait list for housing choice vouchers regionally, with the largest number located in Grand Traverse County (1,496). Overall, there are approximately 18 households on the wait list for every one housing choice voucher issued.

The region needs at 8,813 more rental units, with Grand Traverse County needing at least 3,569 units. The largest category in Grand Traverse County – 2,358 units – are needed for people making less than 50 percent of the area median income (AMI). About two-thirds of northern Michigan’s total rental supply is in “non-conventional” rental housing, or buildings with under four units (such as single-family homes, duplexes, mobile homes, or apartments above businesses). The median rent for a one-bedroom unit in that category is $1,350 – a rate “most lower-income households cannot afford,” Bowen said. Grand Traverse County has a “serious challenge with affordable renter and owner-occupied housing,” he added, pointing to the significant number of renters paying over one third of their income (48.7 percent) or over one half of their income (24.5 percent) on housing.

Northern Michigan also needs at least 22,455 more for-sale units, with the largest number (7,792) again located in Grand Traverse County. With for-sale residences, the largest need in Grand Traverse County is for people making 81-120 percent AMI. Bowen acknowledged thousands of units are not likely to suddenly come online (though he said the report does reflect units that are planned or proposed in the pipeline). But knowing where the greatest need is can help communities prioritize housing units within those categories and affordability levels, he said.

Demand is only going to increase in the coming years, Bowen said. Nearly all counties in the region – except for Missaukee – are projected to experience household growth between now and 2027. Nearly three-quarters of that growth is expected to happen in Grand Traverse County, which is anticipated to add 949 households – a 2.3 percent growth rate. Bowen called that an “unusual” trend for a rural area, adding it outpaces the projected growth of Michigan overall. “Rural communities have a tough time holding on to folks,” he said. “You really defied the odds.”

Bowen said it was important to note which age categories are expected to grow, as that affects the type of housing needed locally. Grand Traverse County will see its biggest growth in ages 75+ (23.1 percent increase by 2027), 65-74 (9.5 percent increase), and 35-44 (6.8 percent increase). Meanwhile, the county will likely see declines in the 25-34, 45-54, and 55-64 age groups. “You're going to have to think about housing for seniors in the years ahead,” Bowen said.

Education, marriage, and income levels – over 32,000 people regionwide suffer from poverty, with numbers concentrated in the southeast portion of northern Michigan – also affect what type of housing is needed and where. In addition to addressing affordability and availability, communities must also address quality, Bowen said. Nearly 2,000 households are considered "overcrowded" in northern Michigan, and over 1,200 households are in units lacking complete kitchens or plumbing. Considering how to upgrade existing housing stock should be another fundamental aspect of the discussion, Bowen said.

Bowen also addressed vacation rentals and seasonal housing in his presentation. Such units account for more than a quarter of the total housing in northern Michigan (varying from as low as 9.8 percent in Grand Traverse County to 40.3 percent in Benzie County). The report advocates for “addressing this market, particularly given the lack of rental and for-sale housing product that is available.” Bowen said that increases in seasonal and short-term rental housing “are chipping away at permanent housing stock” across the region.

While the overall HNA snapshot is grim – “You desperately need more housing,” Bowen summarized bluntly – it also includes recommendations for addressing some of the challenges raised. The report calls for developing an action plan that sets housing goals and priorities, establishes benchmark data, and periodically evaluates progress. More vigorous efforts to regulate vacation rentals, identify potential development sites, and review local housing regulations are also recommended. The HNA contains an individualized report for each county, including a SWOT (strengths/weaknesses/opportunities/threats) analysis, which can allow communities to customize their approach to their unique needs.

Most importantly, addressing housing will require collaboration across multiple sectors, Bowen said. If anyone thinks that government entities, nonprofit groups, or private developers can solve the issue alone, “they’ve underestimated the problem,” he said. “You really need all hands on deck, because the problems are rather large and can be complex to solve.”